Software Giant Defies Industry Norm with Salary Increases

FromSoftware's recent announcement of a significant salary increase for new graduate hires stands in stark contrast to the widespread layoffs impacting the gaming industry in 2024. This article explores FromSoftware's decision and the broader context of the industry's current challenges.

FromSoftware's Counter-Trend Salary Boost

FromSoftware Raises Starting Salaries by 11.8%

While numerous video game companies implemented layoffs in 2024, FromSoftware, the developer behind critically acclaimed titles like Dark Souls and Elden Ring, has taken a different path. Beginning April 2025, the company will increase the starting monthly salary for new graduate hires from ¥260,000 to ¥300,000 – an 11.8% increase. In a press release dated October 4, 2024, FromSoftware stated this increase reflects its commitment to a stable and rewarding work environment that fosters employee dedication to game development.

In 2022, FromSoftware faced criticism for relatively lower salaries compared to other Japanese studios, despite its global success. Previously reported average annual salaries of around ¥3.41 million (approximately $24,500) were noted by some employees as insufficient to cover Tokyo's high cost of living. This salary adjustment aims to align FromSoftware's compensation with industry standards, mirroring similar moves by companies like Capcom, which is implementing a 25% increase (from ¥235,000 to ¥300,000) by the start of its 2025 fiscal year.

A Tale of Two Industries: West vs. East

The global video game industry experienced a turbulent 2024, marked by unprecedented levels of layoffs. Thousands of jobs were cut across major companies, primarily in North America and Europe, despite record profits in many cases. This contrasts sharply with the Japanese gaming sector, which largely avoided these widespread reductions.

Over 12,000 game industry employees worldwide lost their jobs in 2024 alone, exceeding the 10,500 figure from 2023. While Western companies cited economic uncertainty and mergers as reasons for the cuts, the Japanese approach differed significantly.

Japan's stable employment landscape is attributed to its robust labor laws and corporate culture. Unlike the "at-will employment" prevalent in the US, Japan's worker protections and limitations on arbitrary dismissals create significant barriers to mass layoffs.

Furthermore, several major Japanese game companies, including Sega (33% increase in February 2023), Atlus (15%), Koei Tecmo (23%), and Nintendo (10%), implemented salary increases, even amidst lower profits in some cases. These increases may be a response to Prime Minister Fumio Kishida's push for nationwide wage hikes to combat inflation and improve working conditions.

However, the Japanese industry isn't without its challenges. Long working hours, often exceeding 12 hours a day for six days a week, remain a concern, particularly for contract workers whose contracts may not be renewed without being classified as layoffs.

While 2024 saw a record number of global video game industry layoffs, Japan's relative stability provides a compelling case study. The future will reveal whether this approach can continue to protect its workforce amidst growing global economic pressures.